In the ever-evolving semiconductor landscape, Texas Instruments Incorporated (TXN) and Silicon Laboratories Inc. (SLAB) stand out as key players. Both companies operate in the same industry, yet they exhibit distinct innovation strategies and market focuses. Texas Instruments excels in analog and embedded processing solutions, while Silicon Labs emphasizes mixed-signal solutions for the Internet of Things (IoT). As we delve into this comparison, I invite you to discover which of these companies might be the most compelling addition to your investment portfolio.
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Company Overview
Texas Instruments Incorporated Overview
Texas Instruments Incorporated (TXN), founded in 1930 and headquartered in Dallas, Texas, is a leading semiconductor company that designs and manufactures a broad range of analog and embedded processing products. With a market cap of approximately $151B, TXN’s mission is to make electronics more accessible through innovative semiconductor solutions. Its products serve diverse sectors, including industrial, automotive, and personal electronics, facilitating enhancements in power management, signal processing, and embedded computing. Known for its strong dividend policy, Texas Instruments aims to deliver reliable financial performance and consistent shareholder returns.
Silicon Laboratories Inc. Overview
Silicon Laboratories Inc. (SLAB), established in 1996 and based in Austin, Texas, is a fabless semiconductor firm specializing in analog-intensive mixed-signal solutions. With a market cap of around $4.13B, the company focuses on providing innovative products for the Internet of Things (IoT), enabling smart home applications, industrial automation, and medical instrumentation. Silicon Labs emphasizes connectivity and energy efficiency, catering to an increasingly digital world. As a relatively smaller player in the semiconductor space, SLAB is recognized for its agility and responsiveness to emerging market trends.
Key similarities between Texas Instruments and Silicon Laboratories are their focus on semiconductor solutions and their commitment to innovation in technology. However, they differ significantly in market segments, with Texas Instruments offering a broader range of analog and embedded products, while Silicon Laboratories concentrates on mixed-signal solutions for IoT applications.
Income Statement Comparison
The table below provides a comparison of the most recent income statements for Texas Instruments (TXN) and Silicon Laboratories (SLAB), highlighting key financial metrics.
| Metric | Texas Instruments (TXN) | Silicon Laboratories (SLAB) |
|---|---|---|
| Revenue | 15.64B | 584.39M |
| EBITDA | 7.54B | -104.92M |
| EBIT | 5.96B | -153.50M |
| Net Income | 4.80B | -191.01M |
| EPS | 5.24 | -5.93 |
Interpretation of Income Statement
Texas Instruments has shown a slight decline in revenue from 17.52B in 2023 to 15.64B in 2024, which is concerning but not alarming given their robust net income of 4.80B. The company maintains strong margins, reflecting effective cost management. In contrast, Silicon Laboratories experienced a significant drop in revenue from 782.26M in 2023 to 584.39M in 2024, leading to negative net income of -191.01M. This decline in performance suggests challenges in maintaining profitability, highlighting the need for strategic adjustments to improve margins and stabilize earnings.
Financial Ratios Comparison
The following table provides a comparison of key financial metrics for Texas Instruments Incorporated (TXN) and Silicon Laboratories Inc. (SLAB). These metrics will help us gauge the financial health and performance of both companies.
| Metric | TXN | SLAB |
|---|---|---|
| ROE | 28.39% | -17.69% |
| ROIC | 14.75% | -18.15% |
| P/E | 35.63 | -121.88 |
| P/B | 10.12 | 3.81 |
| Current Ratio | 4.12 | 6.15 |
| Quick Ratio | 2.88 | 5.07 |
| D/E | 0.80 | 0.01 |
| Debt-to-Assets | 38.29% | 1.27% |
| Interest Coverage | 10.76 | -126.33 |
| Asset Turnover | 0.44 | 0.48 |
| Fixed Asset Turnover | 1.38 | 4.42 |
| Payout Ratio | 99.92% | 0% |
| Dividend Yield | 2.80% | 0% |
Interpretation of Financial Ratios
Texas Instruments shows strong performance with a solid return on equity (28.39%) and a reasonable price-to-earnings ratio (35.63), indicating good profitability and investor confidence. In contrast, Silicon Laboratories struggles, reflected in its negative return on equity and high debt-to-equity ratio, signaling potential financial instability. Investors should proceed with caution regarding SLAB, given its weak metrics and lack of dividends.
Dividend and Shareholder Returns
Texas Instruments (TXN) has a consistent dividend policy with a payout ratio of approximately 70%, offering a dividend yield around 2.94%. This indicates a stable distribution supported by strong free cash flow, albeit with potential risks related to its high payout ratio. Conversely, Silicon Laboratories (SLAB) does not pay dividends, reflecting reinvestment in growth strategies amid negative net income. Both companies engage in share buybacks, but TXN’s approach may better support long-term shareholder value compared to SLAB’s focus on growth.
Strategic Positioning
In the semiconductor industry, Texas Instruments (TXN) holds a prominent market share with a strong focus on analog and embedded processing solutions, positioning itself as a leader. Meanwhile, Silicon Laboratories (SLAB) targets the growing Internet of Things (IoT) market with its analog-intensive mixed-signal products, carving out a niche. Both companies face competitive pressure and potential technological disruptions, necessitating continuous innovation to maintain their market standings and address evolving customer needs.
Stock Comparison
In analyzing the weekly stock price movements for Texas Instruments (TXN) and Silicon Laboratories (SLAB), we can observe significant price dynamics that have unfolded over the past year, reflecting both bullish and bearish trends in the respective stocks.
Trend Analysis
Texas Instruments (TXN) has experienced a price change of +0.64% over the past year. This indicates a bullish trend, although the trend is currently showing signs of deceleration as evidenced by a recent price drop of -9.0% from September 14, 2025, to November 30, 2025. The stock reached a notable high of 221.25 and a low of 147.6 during this period, with a standard deviation of 16.9, suggesting moderate volatility.
Silicon Laboratories (SLAB), on the other hand, has seen a more pronounced annual price change of +4.16%, also indicating a bullish trend. However, it has faced a recent decline of -6.11% within the same timeframe as TXN, showing deceleration in its upward momentum. The stock hit a high of 155.33 and a low of 89.82, with a standard deviation of 13.72, which reflects a comparable level of volatility to TXN.
In conclusion, while both stocks are positioned in a bullish trend over the longer term, recent movements raise caution over their short-term performance, particularly with the observed declines.
Analyst Opinions
Recent analyst recommendations for Texas Instruments (TXN) generally lean towards a “buy” rating, underscored by a solid return on equity (5) and return on assets (5), indicating strong financial performance. Analysts highlight its robust cash flow potential and moderate debt levels. In contrast, Silicon Laboratories (SLAB) received a “sell” rating, attributed to weaker performance across key metrics, including a low overall score of 1. The consensus for TXN is “buy,” while SLAB is viewed as a “sell” for the current year.
Stock Grades
Here are the latest stock ratings for Texas Instruments Incorporated (TXN) and Silicon Laboratories Inc. (SLAB) from reputable grading companies.
Texas Instruments Incorporated Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Susquehanna | Maintain | Positive | 2025-10-22 |
| Rosenblatt | Maintain | Buy | 2025-10-22 |
| Truist Securities | Maintain | Hold | 2025-10-22 |
| Wells Fargo | Maintain | Equal Weight | 2025-10-22 |
| Goldman Sachs | Maintain | Buy | 2025-10-22 |
| JP Morgan | Maintain | Overweight | 2025-10-22 |
| Cantor Fitzgerald | Maintain | Neutral | 2025-10-22 |
| Stifel | Maintain | Hold | 2025-10-22 |
| TD Cowen | Maintain | Buy | 2025-10-22 |
| Mizuho | Downgrade | Underperform | 2025-10-20 |
Silicon Laboratories Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Susquehanna | Maintain | Neutral | 2025-08-06 |
| Morgan Stanley | Maintain | Equal Weight | 2025-08-06 |
| Barclays | Maintain | Equal Weight | 2025-08-05 |
| Susquehanna | Maintain | Neutral | 2025-07-22 |
| Stifel | Maintain | Buy | 2025-07-18 |
| Keybanc | Maintain | Overweight | 2025-07-08 |
| Benchmark | Maintain | Buy | 2025-05-27 |
| Needham | Maintain | Buy | 2025-05-14 |
| Benchmark | Maintain | Buy | 2025-05-14 |
| Susquehanna | Maintain | Neutral | 2025-05-14 |
Overall, the trend in grades for both companies shows a consistent preference for maintaining their current ratings, with a notable number of “Buy” and “Maintain” actions, indicating a stable outlook. However, Texas Instruments did experience a downgrade from Mizuho, worth noting for potential investors.
Target Prices
Based on the latest analyst data, here are the target prices for Texas Instruments and Silicon Laboratories.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Texas Instruments (TXN) | 245 | 145 | 190.45 |
| Silicon Laboratories (SLAB) | 165 | 130 | 147.5 |
Texas Instruments has a target consensus of 190.45, which is above its current price of 165.99, suggesting potential upside. Silicon Laboratories also shows a promising target consensus of 147.5 compared to its current price of 125.58, indicating favorable analyst expectations as well.
Strengths and Weaknesses
The following table outlines the strengths and weaknesses of Texas Instruments (TXN) and Silicon Laboratories (SLAB) based on the most recent data.
| Criterion | Texas Instruments (TXN) | Silicon Laboratories (SLAB) |
|---|---|---|
| Diversification | Strong focus on analog and embedded processing products | Limited product range focusing on IoT solutions |
| Profitability | Net profit margin: 37.16% | Net profit margin: -4.41% |
| Innovation | High R&D investment, strong product development | Moderate innovation but currently facing profitability challenges |
| Global presence | Operates in multiple markets worldwide | Strong presence in IoT markets, but less global reach |
| Market Share | Significant share in semiconductor sector | Smaller market share within the semiconductor industry |
| Debt level | Debt-to-equity ratio: 0.8 | Low debt-to-equity ratio: 0.05 |
Key takeaways indicate that Texas Instruments boasts strong profitability and diversification, making it a solid investment choice. In contrast, Silicon Laboratories faces challenges with profitability and limited product range, suggesting a more cautious approach for investors.
Risk Analysis
The following table outlines the key risks associated with Texas Instruments (TXN) and Silicon Laboratories (SLAB).
| Metric | Texas Instruments (TXN) | Silicon Laboratories (SLAB) |
|---|---|---|
| Market Risk | Moderate | High |
| Regulatory Risk | Low | Moderate |
| Operational Risk | Low | High |
| Environmental Risk | Moderate | Moderate |
| Geopolitical Risk | Moderate | High |
Both companies face significant market and operational risks, particularly Silicon Labs, which has recently reported operational losses and volatility. Their exposure to semiconductor market fluctuations and geopolitical tensions adds to the risk profile.
Which one to choose?
When comparing Texas Instruments (TXN) and Silicon Laboratories (SLAB), Texas Instruments appears to be the more favorable choice for investors. TXN boasts a strong market cap of $171B, a net profit margin of 30.68%, and solid performance indicators, including a B rating from analysts. In contrast, SLAB struggles with negative profit margins and a lower market cap of $4.11B, resulting in a C- rating.
Analysts have set a price target for TXN at approximately $221, reflecting a bullish trend, while SLAB’s recent trend shows a decline. Investors focused on growth may prefer Texas Instruments due to its robust fundamentals and market position. Conversely, those seeking riskier investments with potential for future recovery might consider Silicon Laboratories.
Key risks for both companies include market dependence and competition in the semiconductor industry.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Go further
I encourage you to read the complete analyses of Texas Instruments Incorporated and Silicon Laboratories Inc. to enhance your investment decisions:
